Auditing State Budget Final Accounts: Strengthening Fiscal Discipline Through Early Warnings

Pham Thuy Chinh, Vice Chairwoman of the National Assembly's Committee on Economic and Financial Affairs. Photo: quochoi.vn

Madam, the SAV has just submitted its audit report on the 2025 State Budget final accounts to the National Assembly. This is the first year the SAV has audited the State Budget final accounts under the 2025 State Budget Law. From the perspective of the reviewing body, how do you assess the quality of the report?

I highly appreciate the SAV's efforts in the first year of auditing the State Budget final accounts under the 2025 State Budget Law. For the reviewing body, the audit report provides an independent, objective and reliable source of information and data against which to cross-check the Government's final accounts report.

This year's audit report on the State Budget final accounts reflects a clear transformation in the SAV's operations in 2026. Audits of final accounts reports have been conducted proactively and comprehensively at 100% of central ministries, agencies and local government units. In particular, local budget audits were brought forward and largely completed by June, providing information to provincial and municipal People's Councils for approval of their final accounts.

As of September 30, 2026, across 145 audit reports issued, including audits of final accounts, the SAV had recommended financial adjustments totaling nearly VND 114 trillion, proposed amendments and supplements to 195 legal documents, and referred 16 cases showing signs of legal violations to investigative authorities, four times the number in 2025. The implementation rate for recommendations on financial adjustments and other matters exceeded 79%.

The SAV's findings provide an important basis for the Committee on Economic and Financial Affairs and other National Assembly bodies to review and assess the quality of State Budget preparation, execution and finalization.

I particularly value the SAV's evidence-based early-warning function. The value of an audit report goes beyond confirming whether figures are correct or incorrect. What the National Assembly needs is a clear understanding of the quality of budget preparation and execution, the effectiveness of budget utilization, and the responsibilities that must be clarified before approval of the final accounts is considered.

The audit report provides an independent, objective and reliable source of information and data for cross-checking against the Government's final accounts report. Photo: TL

According to the audit findings and the review report, total State Budget revenue recorded in the 2025 final accounts increased by 31.1% compared with 2024. Revenue from land, minerals, lottery activities and other sources accounted for a considerable share, while more sustainable revenue sources tended to decline in relative terms. What is your assessment of this issue?

I believe that a declining share does not necessarily mean a decrease in absolute revenue, but it is a signal that the revenue structure requires close monitoring. Revenue exceeding estimates must also be considered in relation to the quality of forecasting and revenue sources that were not fully captured at the budget preparation stage. If revenue growth above estimates is used as the sole benchmark, we risk overestimating the actual fiscal space available.

For the 2027 budget year and the medium term, revenue from land, natural resources and the digital economy must be closely managed, while revenue leakage must be addressed using transparent data. At the same time, stable revenue sources should be cultivated by improving productivity, developing businesses and broadening the tax base. Recurring revenue must be distinguished from one-off receipts to ensure that expenditure levels and commitments are appropriate and sufficient fiscal space is preserved to respond to fluctuations. In this regard, audit data provide a reliable basis for the National Assembly and the Government to jointly assess the true quality of revenue sources and make decisions that better reflect actual conditions.

The SAV's report clearly distinguishes isolated errors from systemic risks, as well as audit conclusions from assessments requiring further verification. On this basis, the National Assembly will continue to oversee the implementation of recommendations through to completion, ensuring that each budget finalization cycle not only closes the accounts for a fiscal year but also raises fiscal discipline to a higher level in subsequent years.

The SAV also found that disbursement of central budget capital for development investment reached only 76.3%, down from 83.4% in 2024. Delayed projects and delays in preparing final accounts for completed projects also persisted. In your view, what does this reveal about the implementation of capital plans?

The gap between the overall disbursement rate of 97.8% and the 76.3% disbursement rate for central budget development investment demonstrates that public investment cannot be assessed using a single aggregate indicator. Nor can disbursed capital be equated with completed work or the actual effectiveness of a project.

Delayed projects and late finalization reflect bottlenecks somewhere in the investment cycle. I highly appreciate the Government's decisive direction in accelerating disbursement and am particularly impressed by Prime Minister Le Minh Hung's position that budget expenditure and disbursement must be assessed based on the actual effectiveness of projects and the accountability of local authorities.

Therefore, the measures the Government has been directing and implementing must continue to be carried out effectively. However, there must be a stronger shift away from allocating funds simply to exhaust the available budget plan and toward allocation based on project readiness and the capacity to deliver results. Projects that do not meet the necessary conditions should not retain funding while projects capable of completion lack resources. Advances must be reconciled against accepted work volumes and recovered on time, while finalization of completed projects must be mandatory to ensure full accountability for the use of capital.

At the same time, monitoring of disbursement progress must be strengthened, with close attention to construction quality, operating capacity, operating costs and the actual impact of projects. If the same obstacles recur across multiple localities, the underlying mechanisms and procedures must be revised. Public investment audit findings are always an extremely important source of information for accurately identifying bottlenecks.

Based on the 2025 State Budget final accounts, what issues should be prioritized in the coming period to strengthen discipline, compliance and the efficiency of budget utilization?

In my view, efforts should focus on three key tasks.

First, improving the quality of budget estimates while strengthening the revenue base toward greater stability and sustainability. Revenue management must continue to rely on data that closely reflect actual conditions, with a focus on preventing revenue leakage in high-risk areas. Stable, long-term revenue sources must be clearly distinguished from exceptional increases. This will enable budget estimates to reflect reality more accurately and establish a solid foundation for budget balance in subsequent years.

Second, tightening expenditure discipline in line with the capacity to put resources to use. Regarding budget carryovers, policy-based carryovers must be distinguished from those arising from delayed allocation, delayed implementation or regulatory violations, so that the appropriate causes can be addressed. In parallel, overdue advances must be fully recovered, outstanding debts resolved, final accounts for completed projects finalized more promptly, and the implementation progress of audit recommendations made public, with specific parties clearly identified as accountable.

Third, measuring budget effectiveness by the results delivered to citizens and businesses and by its contribution to long-term growth capacity. The target of achieving double-digit economic growth also requires selective use of budget capital to create room for the private sector and maintain fiscal safety, rather than expanding expenditure at any cost.

The SAV plays an extremely important role in implementing these tasks. Therefore, in the final months of 2026, it must complete its audit plan on schedule, improve the quality of audit evidence and the feasibility of its recommendations, and promptly review and classify outstanding recommendations in close coordination with the Government to ensure their rigorous resolution.

In 2027, the SAV's key task will be to audit the 2026 State Budget final accounts. This is the first budget year under the 2025 State Budget Law and the first in which the two-tier local government model will be fully operational. Every audit assignment must translate the “six clear” principles into practice: clear objectives and tasks; clear subjects and scope; clear priority areas; clear lead agencies and responsibilities; clear timelines and progress; and clear deliverables and outcomes. Audits should focus on assessing the quality of budget allocation, the effectiveness of resource utilization and the impact on development objectives.

The SAV must also accelerate its shift from document-based auditing to data-driven auditing, and from post-audit reviews to early risk warnings. Local budget audit reports should be issued before People's Councils approve the final accounts, ensuring that audit findings can directly inform decision-making.

Thank you very much for your time!